What's next ?

Dow gave up another 107 points on its second day of decline. Its intraday low of 12007 touched the lower trend line as shown below.



Technically Dow should not go below the lower support line as it has one more sub-wave to go, the sub-wave ix, that can last another week or two before wave 5 ended, if there is no more extension of sub-wave.

However if Dow were to close below 12,000 at the close of Thursday session as shown below,


That would lead to a failure wave 5 scenario with sub-wave ix missing due to the overwhelming downward momentum. Then probability is high that last Friday closing of 12,391 could be the peak of mega wave B, the end of the rebound since March 2009's low of 6,547.

For your health